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Another $7 million omitted from Manatee schools budget

An analysis led by interim Manatee schools Superintendent David Gayler found another $7 million in spending was omitted from the district's budget.

HERALD-TRIBUNE ARCHIVE / 2012 / ELAINE LITHERLAND

By CHRISTOPHER O'DONNELL

Published: Tuesday, December 4, 2012 at 6:35 p.m.

Last Modified: Tuesday, December 4, 2012 at 6:35 p.m.

MANATEE COUNTY - More evidence of financial problems within the Manatee County School District emerged Tuesday as officials revealed that about $7 million in spending was omitted from the district's budget for this school year.

Facts

WHAT ISN'T COVERED?

About $7 million in spending was not included in Manatee County Schools' operating budget because items were either omitted or the cost underestimated.

Here's a look at some of the expenditures that the district officials are scrambling to be able to afford:

1 percent bonus for employees: $2.5 million

Utility bills: $543,000

Payment for unused annual leave: $1 million

Overtime: $250,000

Band uniforms: $90,000

Saturday school detentions: $78,000

An analysis led by Interim Superintendent David Gayler found that a 1 percent bonus promised to staff that would cost $2.5 million was inexplicably left out of the budget. About a dozen other expenditures were also missing, including pay for teachers who work after hours with struggling students and funds to pay for busing to athletic events.

Budget estimates for utility bills and pay for unused sick and vacation days are also short by a combined $1.5 million, officials warned School Board members at a workshop Tuesday evening.

Gayler said he hopes to offset some of the losses with savings from the district's food service program and by limiting overtime.

But that still leaves the district needing to find another $5.3 million in order to be able to afford the promised bonuses.

The revelations come as the district continues to deal with the fallout from its $8 million in overspending in 2011-12 because of unbudgeted spending, including the hiring of almost 60 extra teachers.

That left the district $3.4 million in the red and led then-Superintendent Tim McGonegal to resign. A forensic audit by a Tampa team from Navigant began in October.

District Chief Financial Officer Michael Boyer, who was hired in March, said it appeared that some items had not been budgeted for several years.

The district was still able to pay its costs by borrowing from its reserve fund, he said.

“It was never a big deal to dip into those and fund those items,” Boyer said.

But overspending finally caught up with the district at the end of last year.

“The only thing that surprised me is how long we were doing that before we crashed,” Board Vice Chairwoman Julie Aranibar said.

Boyer also revealed that in 2009, someone in the district removed an accounting process that stopped departments from hiring employees when there was insufficient funds to pay for them.

He said that was likely the major cause of overspending in 2011-12.

“We've been hemorrhaging for quite some time,” Boyer said.

Finance experts in other districts said it was inconceivable that an organization as large as Manatee, which employs more than 5,000 people, could hope to keep tabs on expenses without such a control system.

“That is totally insane,” said Al Weidner, Sarasota deputy chief financial officer. “I can't believe McGonegal was aware of that. Being a finance guy he would know that was a recipe for disaster.”

Gayler said he is optimistic the district can find the savings necessary to cover the costs for unbudgeted programs, like the $214,000 that pays for the International Baccalaureate programs at three schools and $300,000 that rewards teachers who take extra training.

But he admitted that awarding a bonus or pay raise this school year was now hanging on a “big if.”

Nonetheless, Gayler said, the district would not cut salaries to make up any shortfall.

“We're not going there,” he said. “Those people have been through enough.”

<p><em>MANATEE COUNTY</em> - More evidence of financial problems within the Manatee County School District emerged Tuesday as officials revealed that about $7 million in spending was omitted from the district's budget for this school year.</p><p>An analysis led by Interim Superintendent David Gayler found that a 1 percent bonus promised to staff that would cost $2.5 million was inexplicably left out of the budget. About a dozen other expenditures were also missing, including pay for teachers who work after hours with struggling students and funds to pay for busing to athletic events.</p><p>Budget estimates for utility bills and pay for unused sick and vacation days are also short by a combined $1.5 million, officials warned School Board members at a workshop Tuesday evening.</p><p>Gayler said he hopes to offset some of the losses with savings from the district's food service program and by limiting overtime.</p><p>But that still leaves the district needing to find another $5.3 million in order to be able to afford the promised bonuses.</p><p>The revelations come as the district continues to deal with the fallout from its $8 million in overspending in 2011-12 because of unbudgeted spending, including the hiring of almost 60 extra teachers.</p><p>That left the district $3.4 million in the red and led then-Superintendent Tim McGonegal to resign. A forensic audit by a Tampa team from Navigant began in October.</p><p>District Chief Financial Officer Michael Boyer, who was hired in March, said it appeared that some items had not been budgeted for several years.</p><p>The district was still able to pay its costs by borrowing from its reserve fund, he said.</p><p>“It was never a big deal to dip into those and fund those items,” Boyer said.</p><p>But overspending finally caught up with the district at the end of last year.</p><p>“The only thing that surprised me is how long we were doing that before we crashed,” Board Vice Chairwoman Julie Aranibar said.</p><p>Boyer also revealed that in 2009, someone in the district removed an accounting process that stopped departments from hiring employees when there was insufficient funds to pay for them.</p><p>He said that was likely the major cause of overspending in 2011-12.</p><p>“We've been hemorrhaging for quite some time,” Boyer said.</p><p>Finance experts in other districts said it was inconceivable that an organization as large as Manatee, which employs more than 5,000 people, could hope to keep tabs on expenses without such a control system.</p><p>“That is totally insane,” said Al Weidner, Sarasota deputy chief financial officer. “I can't believe McGonegal was aware of that. Being a finance guy he would know that was a recipe for disaster.”</p><p>Gayler said he is optimistic the district can find the savings necessary to cover the costs for unbudgeted programs, like the $214,000 that pays for the International Baccalaureate programs at three schools and $300,000 that rewards teachers who take extra training.</p><p>But he admitted that awarding a bonus or pay raise this school year was now hanging on a “big if.”</p><p>Nonetheless, Gayler said, the district would not cut salaries to make up any shortfall.</p><p>“We're not going there,” he said. “Those people have been through enough.”</p>